Cover -- Contents -- THE IMPACT OF MEXICO'S ENERGY REFORM ON HYDROCARBONS PRODUCTION -- A. Current Challenges in the Energy Industry -- B. Most Significant Reform Effort in 75 Years -- C. Impact on Energy Production -- D. Resource Blessed -- E. How Long Does it Take? -- F. Production Scenarios -- G. How Much Investment and FDI? -- H. Natural Gas Imports and Transport -- I. Electricity Reform -- J. Conclusion -- References -- FIGURES -- 1. Illustrative Baseline Scenarios -- 2. Illustrative Downside Scenarios -- MADE IN MEXICO: THE ENERGY REFORM AND MANUFACTURING OUTPUT -- A. Introduction -- B. The Mexican Manufacturing Sector Since NAFTA -- C. The Energy Reform: How Much of a Boost for Mexican Manufacturing? -- D. Are There Additional Indirect Effects Through Spillovers? -- E. Concluding Remarks and Policy Implications -- References -- TABLES -- 1. Energy Consumption (in Petajoules) of the Industrial Sector -- 2. Estimates of Elasticities of Manufacturing Output to Energy Prices -- 3. Estimates of Elasticities When Energy Inputs Enter Separately -- 4. Differential Effects Across Subsectors -- APPENDIX -- I. Panel VAR model -- APPENDIX FIGURES -- 1. Impulse Response Functions to a Rise in Electricity Prices with Subsector Spillovers -- 2. Impulse Response Functions to a Rise in Electricity Prices with Regional Spillovers -- CAPITAL FLOW VOLATILITY AND INVESTOR BEHAVIOUR IN MEXICO -- A. Introduction -- B. Recent Episodes of Extreme Capital Movements in Mexico -- C. Behavior of Foreign and Domestic Mutual Funds in Mexico -- D. Does Foreign Participation Amplify External Shock? A Time-Series Analysis of Mexican Sovereign Bond Market -- E. Concluding Remarks -- References -- BOXES -- 1. OLS and Multivariate GARCH Models -- 2. Data on Foreign Mutual Funds -- FIGURES -- 1. Mexico: Extreme Capital Flow Episodes.

2. Evidence of Herding (net sellers as a percent of total funds) -- 3. Evidence of Herding (based on the herding index) -- TABLES -- 1a. Bond Funds: Evidence of Positive Feedback Trading Behavior -- 1b. Equity Funds: Evidence of Positive Feedback Trading Behavior -- 2a. Robustness Check (1)-Using a Longer Sample for Foreign Mutual Funds -- 2b. Robustness Check (2)-Using Dollar-Denominated Return on the 3-month Government Bonds -- 3a. OLS Regression Results (VIX Shock) -- 3b. OLS Regression Results (U.S. Tapering Shock) -- 4a. Multivariate GARCH Results (VIX Shock) -- 4b. Multivariate GARCH Results (U.S. Tapering Shock).